The bank told you wrong. The first home exemption ONLY applies to IRA's, not 401(k) plans.
401(k) plans are employer plans administrated by the employer of employers trustee, not usually a bank. Are you sure that it is a 401(k) plan? You usually cannot withdraw from a 401(k) plan until you retire or apply for a hardship withdrawal.
Is the IRA/SEP/SIMPLE box on your 1099-R checked?
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
